From reader Ned, CZ may be looking to purchase Colt.
The parent companies of both Colt and CZ have been negotiating a deal that may make firearms history. CZ is looking to buy out Colt following years of financial trouble for the iconic American firearms company.
While some people may not like the idea of a Czech firm swooping in to buy up one of the most storied manufacturers in American history, gun enthusiasts might see this in a completely different light. CZ might not be a household name like Colt, but gun owners everywhere know about CZ.
According to the CZ Group, the two have agreed to initial terms and CZ is now performing due diligence work before finalizing the deal. CZ expects to finish the due diligence period by the end of January 2021.
“The parties have reached an agreement in principle on key commercial parameters of the transaction,” said the CZ Group in a statement (.pdf). “Execution of the definitive documentation for the transaction is estimated to take place by the end of January 2021, subject to completing the negotiations, finalizing the transaction documentation, and obtaining necessary approvals of the relevant stakeholders.”
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The question remains, what will a CZ-operated Colt’s Manufacturing look like? Hopefully a lot like Dan Wesson. CZ acquired Dan Wesson Firearms in 2005 in a move that revitalized the American company while preserving its legacy.
This is an interesting move, and not one I quite understand, frankly. I’m not sure what the business model will look like. Colt, like Remington, may be irretrievably lost.
For instance, has CZ considered that it may be impossible to conduct business in a financially responsible manner in a Northern state, combined with union labor? Why wouldn’t they move Colt to a right-to-work state? Or maybe they are considering that.
I’m also not quite sure what it means to purchase Colt? Does this mean purchasing the rights to designs, branding, machinery, people-equity and intellectual property? Also consider that any purchase of a company also means responsibility for debt.
CZ is making some fine equipment today. I’d hate to see the brand sullied by failure to turn Colt around.